Super Group’s share price falls after predicting lower interim earnings

A Super Group truck. Photo: Supplied

A Super Group truck. Photo: Supplied

Published Feb 21, 2024

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Super Group’s share price plunged more than 8% yesterday on the JSE after the global logistics and supply chain group predicted that headline earnings per share would fall 16.2% for the six months to December 31.

The share price on the JSE was trading 8.65% lower at R25.99 yesterday afternoon. A year previously the share price was at R33.

The group said in a trading statement that the outhern African Supply Chain business performed, in spite of severe infrastructure problems.

There had been a “significant loss of trading volumes and very slow turnaround times at South African ports”. South African border efficiencies were equally “dismal”, particularly over the October 2023 to December 2023 period, the group said.

The SG Fleet business performed strongly and order books were healthy across the Australasian operations.

Fleet Africa performed well even though there was “very little new corporate or parastatal tender activity within the southern African market”.

South African Dealerships performed well, delivering modest operating profit growth.

UK Dealerships experienced falling consumer demand, lower used vehicle margins and high interest rates.

At the German and UK Supply Chain businesses, there was lower demand for time critical automotive parts. The German Supply Chain operations also saw margin erosion due to tougher competition.

Group earnings before interest, tax, depreciation and amortisation increased by 5.1% to R4.24 billion, while revenue increased 11.9% to R33.22bn. However, headline earnings per share (cents) were expected to decline by 16.2% to 201.2 cents.

The growth in turnover was largely due to acquisitions and weakening of the rand compared to a basket of the group’s trading currencies.

Trading patterns for the second half-year to June 2024 were expected to remain largely unchanged, Super Group’s directors forecast.

Further cost rationalisation strategies were under way across the European Supply Chain businesses, which, with less overpriced inventories of used vehicles in the UK, was likely to result in a modest uptick in comparative financial performance.

BUSINESS REPORT